Europeans Refuse To Impose Sanctions On Yugoslavia U.S. Loses Bid To Freeze Assets Of Nation Over Lack Of Action In Kosovo Situation

The United States lost its bid Wednesday to punish Yugoslav President Slobodan Milosevic for not fully meeting Western demands that he make peace in Kosovo, as European allies rejected an American push for an immediate freeze on his nation’s overseas financial assets.

Foreign ministers of the Contact Group, the six-nation panel charged with monitoring conflicts in the Balkans, had given Milosevic until March 19 to pull Serbian security forces out of Kosovo and begin a serious dialogue with ethnic Albanians to give them more political say in the province. Kosovo is part of Serbia, Yugoslavia’s dominant republic.

But while the Yugoslav leader failed to meet the allied deadline, he took enough modest steps to convince Russia and other reluctant European powers that sufficient progress had been made to obviate the need for further sanctions, which the group had threatened should Milosevic flout its demands.

As a result, the ministers settled for a compromise giving Milosevic another four weeks to begin serious talks with the ethnic Albanians, who make up 90 percent of Kosovo’s 2.1 million people, and to meet other allied demands. The ministers warned that they will freeze Yugoslavia’s overseas assets - and consider other sanctions - if Milosevic does not comply.

Although U.S. officials tried to put a good face on the decision, the outcome was a setback for the Clinton administration. U.S. officials had argued that the only way to prevent Milosevic from repeating brutalities such as the recent crackdown on Kosovo separatists that left more than 80 people dead is to punish him until he is convinced that he must stop.

Secretary of State Madeleine Albright, chairwoman of the ministerial-level meeting Wednesday, called the Contact Group’s moves “the minimum degree of pressure needed” to compel action by Milosevic and forestall a bid by some European allies to ease existing sanctions.

In Kosovo, ethnic Albanian political leaders were disappointed by the Contact Group’s decision. They expressed fear that Milosevic will interpret it as a green light for another crackdown on separatists.

While the Yugoslav government has said that Serbian special police units have been confined to their barracks in recent weeks, they still are deployed in the province in force, and Milosevic has made only token efforts so far to give the ethnic Albanians any increased political clout. On Monday, an agreement was reached that will allow Albanian students next month into classrooms they have refused to enter or have been barred from since 1991.

Nevertheless, the small signs of progress were enough to turn the tide among European allies. Albright, who had come to Bonn this week prepared to push for the freeze on Yugoslav assets, found herself scrambling to persuade the Europeans not to lift the modest sanctions imposed March 9.

At a news conference Wednesday, a clearly disappointed Albright warned that going easy on Milosevic was exactly what had caused the conflict in Bosnia-Herzegovina to escalate in the early 1990s, eventually involving the allies.

“Clearly, President Milosevic is hoping he can get away with this familiar pattern of behavior by keeping the international community off balance and divided,” she said. “I need not tell you that in the view of the United States, (Milosevic’s response to date) would have justified tougher action.”

Diplomats said only Britain was fully in agreement with the United States on the question of whether to freeze Yugoslavia’s overseas financial assets now. France, Italy, Germany and Russia all opposed immediate imposition of such a measure. Italy, for one, has developed lucrative trade and business ties with Yugoslavia in recent months.

Russia’s reluctance to impose an arms embargo on Yugoslavia has been due in part to its traditional closeness to the country’s majority-Serb population. However, it might also have a more pragmatic motivation: Citing unidentified U.S. officials, The New York Times reported Wednesday that Russia has agreed to sell heavy military equipment, including tanks, missiles and MIG-29 jets, to Yugoslavia.

In Moscow, Russian Foreign Ministry spokesman Vladimir Andreyev denied the report of the planned sale, which would violate the 1995 peace agreement that ended the Bosnian war.